Insurance Glossary

A survey to determine a property’s insurable value, or the amount of loss.

Procedure in which an insurance company and the insured or a vendor agree to settle a claim dispute by accepting a decision made by a third party.

The deliberate setting of a fire.

Property owned, in this case by the insurance company, including stocks, bonds and real estate. Insurance accounting is concerned with solvency and the ability to pay claims. State insurance laws therefore require a conservative valuation of assets, prohibiting insurance companied from listing assets on their balance sheets whose values are uncertain, such as furniture, fixtures, debit balances and accounts receivable that are more than 90 days past due. (See ADMITTED ASSETS)

Facilities through which drivers can obtain auto insurance if they are unable to buy it in the regular or voluntary market. These are the most well-known type of residual auto insurance market, which exist in every state. In an assigned risk plan, all insurers selling auto insurance in the state are assigned these drivers to insure, based on the amount of insurance they sell in the regular market. (See RESIDUAL MARKET)

An agreement under which one party – the assignor – transfers some or all of his ownership rights in a particular property, such as a life insurance policy or an annuity contract, to another party – the assignee.

Building Code Effectiveness Grading. The BCEG scale is a Florida statute designed to evaluate a community's building code and the enforcement of that code. All Florida communities are required to adopt the statute and you may receive a credit based on your community's grade. Each community receives a grade of 1-10, with a 1 being the best. Refer to your policy documents for your community's grade. For questions regarding your community's grade, you should contact your community's Building Department.

Provides a snapshot of a company’s financial condition at one point in time. It shows assets, including investments and reinsurance, and liabilities, such as loss reserves to pay claims in the future, as of a certain date. It also states a company’s equity, known as policyholder surplus. Changes in that surplus are one indicator of an insurer’s financial standing.